Texas beating California in the battle for jobs

CEOs miss weather, but not the business climate

California and Texas are locked in a battle over business. But when it comes to creating new jobs, Texas is the national leader, while the Golden State comes in second.

KCRA 3 traveled to Texas to find out why – and where the jobs are going.

KCRA 3 followed two companies that left California for the Lone Star state. The CEOs said they miss California’s weather climate, but the business climate -- well, that’s a whole different story.

Business is booming in Texas, where high-rise buildings are under construction seemingly everywhere around Houston. Construction cranes are a big part of the Texas skyline.

KCRA 3 counted 22 cranes at the site of the new Exxon Mobile business office complex in Houston, the same city where Chevron also is moving 800 jobs from California to Texas. And the Dallas area will soon be home to an estimated 170 high-paying jobs, as Raytheon moves its headquarters from California.

Waste Connections, one of the biggest recycling companies in the country, is building its new world headquarters just outside of Houston after moving 100 employees from Folsom last year.

“It was a tough decision,” Waste Connections CEO Ron Mittelstaedt said. “California is a hard place to leave on a personal basis. But business-wise, it was pretty much a no-brainer,” Mittelstaedt told KCRA 3.

The decision was so simple, Mittelstaedt explained, because he’ll be moving into a new 200,000-square-foot headquarters in just 16 months, from inception to occupancy.

By contrast, he told KCRA 3, his building in Folsom, though half the size, took four years to be completed due to permitting issues.

“I don’t miss the business bashing at all,” Mittelstaedt said. “You don’t have that (in Texas). People that create jobs and employ people are cheered here.”

But it’s not all yellow roses and bluebonnets in Texas, a state that does not require workers compensation.

In April, a massive explosion killed 14 people and injured hundreds living near a fertilizer plant outside Waco.

Texas, in fact, is the deadliest state in the nation when it comes to workplace accidents. Critics blame a lack of regulations to protect workers.

“Texas has about twice as many workplace fatalities every year as California does,” said Steve Smith, of the California Labor Federation.

And Dan Jacobson, of Environment California, told KCRA 3, “Texas is one of the top four states in the country from toxic chemicals being released into their waterways. It’s because there’s just no tough enforcement in Texas.”

California promoters say the state is leading the way in medical breakthroughs.

“We’re a leader in biotechnology,” said Barbara Hayes, president of SACTO, the Sacramento Area Commerce and Trade Organization. “We’re seeing a lot of investment in stem-cell research and cancer-related research,” Hayes told KCRA 3.

But new Texan Greg Storey, who moved his business from California, had this warning.

“California has got to be more competitive when it comes to the cost of living -- certainly, the taxes,” said Storey, the owner of Happy Cog, a web development firm now located in Austin.

Critics of Texas point out that many of the new jobs pay much lower wages compared to California.

Texas supporters counter the cost of living is much less in Texas, where there’s no state income tax and housing costs are much lower – so, in many ways, the dollar goes further there.

On Tuesday, KCRA 3 will show you why Storey’s firm moved to Texas – and we’ll also present a bright spot in the California economy.

Photos: KCRA's Mike Luery explores Texas' job climate

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Mike Luery/KCRA

KCRA 3's Mike Luery recently went to Texas to explore why the state is No. 1 in the U.S. for job creation.